Spokane City Council approves updated sales tax for affordable housing projects

SPOKANE, Wash. — The Spokane City Council approved an updated version of a sales tax that will go toward housing projects and support services in the community.

The council voted 5-2 for this updated 0.1% sales tax at Monday’s city council meeting.

This tax was first approved in 2020 as the Housing Local Sales Fund. The money from the sales tax was set aside to go toward construction, acquisition and rehabilitation of affordable housing and housing-related support services in Spokane. This tax was made permanent at Monday’s City Council meeting.

According to the city, Spokane needs more than 22,000 housing units by 2046, with more than half of those at 60% of the Area Median Income.

“We know more than one-third of renters are paying more than 50% of their monthly income on costs and are rent burdened. People’s costs are not lining up with what they make,” District 2 City Councilmember Paul Dillon said during Monday’s meeting. “This is an important step for Spokane. I think it does provide us with that flexibility between capital, construction costs for affordable housing, as well as much-needed services.”

District 1 Councilmember Michael Cathcart, who voted against passing this new ordinance during the meeting, said that since the passing of the original ordinance, the city has ignored the process put in place to create more affordable housing options.

“We’ve put a lot of dollars into existing units, which don’t get me wrong, a lot of good comes from that, but my belief was that these dollars really should have been for new units,” Cathcart said. “I do think we can make some changes that would vastly improve this and the overall system, but we’re not there.”

Under the updated ordinance, now called the HEART Fund, 70% of the sales revenue collected annually will go toward acquiring or building new affordable housing or support services, as well as maintenance and operations costs for these facilities. The rest of the funding must be used for the “operation, delivery or evaluation of mental and behavioral health treatment programs and services or housing-related services.”

Services will be available for those living at or below 60% of the county’s median income and are disabled, veterans, senior citizens, domestic violence survivors, or are experiencing homelessness or at risk of being homeless.